President Nicolas Maduro has proposed setting maximum profit margins for businesses across the Venezuelan economy following the discovery of “grotesque” overpricing in the electric appliance sector.

The speculative practices were revealed last week after authorities inspected the pricing structures of chain stores selling electronic and household appliances. Like many businesses in Venezuela, these stores import goods from abroad using dollars granted by the government at the fixed rate (US $1 = 6.3 bolivars) and then sell these goods to local consumers.

However these stores, including the country’s largest electronic appliance chain Daka, were found to be marking-up products by up to 1200% from the import cost, charging consumers what President Madruo called “grotesque prices”.

Officials cited one example of a washing machine which cost 4,200 bolivars to import at the official exchange rate being offered for sale at 47,000 bolivars. The current monthly minimum wage is 4,137 bolivars, including food tickets.

In response, on Friday Maduro announced the temporary occupation of the Daka chain and the enforced sale of all its goods at a “fair price” related to their import cost. Other electronics chains such as JVG also had to open their doors and sell their products at a significantly reduced price.

Various managers of the Daka chain were arrested for their alleged role in the affair. Control of the stores will be returned to company owners once the goods have been sold, although regular price inspections will continue.

The announcement resulted in long queues outside stores as consumers sought to take advantage of the lower prices, with the National Guard and other authorities maintaining order.

However damages and looting were reported to have occurred in one Daka store in the city of Valencia on Saturday morning when some people forced entry into the shop. The Attorney General condemned the incident, and reported that arrests had been made.

The government has informed citizens that those who bought domestic or electric appliances at the speculative prices have the right to their money back.

“Each person who was robbed by those grotesque prices will get their money back, which belongs to the working person,” President Maduro said from the presidential palace in Caracas yesterday.

Maduro also proposed that if granted temporary enabling law-making powers by parliament he will implement a limit on profit margins on sectors across the Venezuelan economy.

“Economic freedom means that I produce and sell with a minimal profit and I respect the consumer. Furthermore I receive the dollar that the state gives me, I bring the product and I sell it at a fair price, and I don’t add an extra 1000% of grotesque profit,” he explained.

Further, the Venezuelan head of state proposed tougher sanctions for those engaged in price speculation using state granted dollars, including prison sentences, saying that such individuals “are robbing the people”.

In the televised address to the nation, the president also confirmed that a package of reforms will come into effect this week to attempt to tackle shortages and price speculation.

These include a beefed-up price inspection force, the new state-run National Corporation of Logistics and Transport to aid the supply of goods to factories and stores, and the new National Centre of Foreign Commerce to better coordinate the allocation of foreign currency to businesses and individuals.

Economic problems continuescarcity index for October at 22.4%, the highest so far this year, and the annual inflation rate for Nov. 2012 – Oct. 2013 at 54%. The minimum wage has increased 45% since April.

The government argues that this situation is the result of an “economic war” being waged by opposition-aligned business sectors in conjunction with actors opposed to the Bolivarian revolution in Colombia and the United States.

Officials say that Venezuelan business federations are behind strategies to hoard or deviate products to provoke shortages, while speculating on prices to drive inflation and cause discontent.

They also argue that unofficial currency websites such as dolartoday.com speculate on the value of the bolivar to create pricing distortions in the economy and to try and provoke a further devaluation of the official rate.

Yesterday Maduro argued that the pricing practices of electronic appliance chains form part of this “economic war”.

“There aren’t economic reasons for the phenomena of shortages and vulgar price increases that we have in the real economy. They’re not economic, it’s not because of the lack of granting foreign currency,” he argued.

In October the government’s Vice Minister for the Economic Area, Rafael Ramirez, said that this year the government is granting 2.6% more dollars to the private sector for imports than last year, when there were fewer shortages.

“Parasitic capitalism is responding to its class nature. It is a chain reaction directed by [Venezuelan business federations]…against the country’s economy to try and destroy the Bolivarian revolution, roll back the inclusive model and [re]capture political power for the factors that led this country for 100 years” argued Maduro.

Some economists and critics of the government have disputed this thesis, arguing that current economic problems are due to imbalances caused by interventionist policies such as currency and price controls. They suggest that macroeconomic monetary and fiscal solutions are required.

Opponents of the Maduro presidency also blame “government mismanagement” for failure to resolve the country’s economic problems. “Maduro, desperate because of his failure and incapacity to direct the country, takes measures that don’t solve the economic crisis,” tweeted opposition leader Henrique Capriles on Saturday.